I.R.S. Commissioner John Koskinen, on Hot Seat, Has History of Bureaucratic Rescue Jobs

John Koskinen, the new I.R.S. commissioner, is at the center of the worst firestorm in the agency’s recent history and Washington’s most prominent punching bag.Credit
Gabriella Demczuk/The New York Times

WASHINGTON — It was clear from the start that John Koskinen, the new commissioner of the Internal Revenue Service, was in for a long night.

At a Capitol Hill hearing, Republican members of Congress pressed him about emails missing from the hard drive of Lois Lerner, a former agency official at the center of a scandal over the scrutiny of applications for tax-exempt status. They wanted to know if he had any evidence that a crime was committed in the destruction of the messages.

Mr. Koskinen seemed fed up. “I have no evidence whether she beat her dog, whether she beat children,” he told them, his voice rising. “I have no evidence of a whole series of things.”

For nearly four hours at the June 23 hearing, Mr. Koskinen, a Yale-trained lawyer who says he gave up practicing law for Lent one year and never looked back, absorbed cascades of verbal salvos and tossed back several of his own. Hired to rehabilitate an agency that went awry targeting political groups, Mr. Koskinen’s style — quick-witted to the point of being flip and sometimes impolitic — has left some wondering if he is the right person to restore the I.R.S.’s battered credibility.

He was two years into retirement in May 2013, filling his days with tennis, theater and grandchildren, when he received a series of urgent telephone calls. The White House and Treasury Department wanted to know if the then 73-year-old with a history as a Washington fixer would be willing to come back to work for one last rescue mission. The I.R.S. was in trouble, and they wanted him to run it.

After a moment of contemplation, Mr. Koskinen, who as a child dreamed of being president, agreed. The decision sent him into the center of the worst firestorm in the agency’s recent history and made him Washington’s most prominent punching bag.

“I think I need counseling,” Mr. Koskinen said, sitting at the head of the long wooden conference table in his beige and brown third-floor office at the I.R.S. headquarters. “I’m a recidivist, going from one kind of crisis to another.”

Mr. Koskinen’s résumé reads like a list of America’s biggest bureaucratic nightmares. Filling a top role in the Office of Management and Budget during the 1990s shutdown; steering the team tasked with averting the Y2K digital apocalypse at the turn of the century; leading Freddie Mac as the financial crisis unfolded.

The I.R.S. crisis has been inflamed by the recent revelations that two years’ worth of emails sent and received by Ms. Lerner disappeared. Although the computer malfunction occurred before Mr. Koskinen’s time at the agency, he has been accused of being slow to alert Congress of the lost evidence; he knew about the lost emails two months before he shared the information. Some critics, claiming he has a bad attitude, have said it is already time for him to go.

In one testy exchange last week with the House Oversight Committee chairman, Representative Darrell Issa, Mr. Koskinen said: “I did not say I would provide you emails that disappeared. If you have a magical way to do that, I would be happy to hear about it.”

Questioned later on Ms. Lerner’s intentions, he replied: “I cannot enter into Lois Lerner’s mind. I have never met her.”

Such responses have not won Mr. Koskinen sympathy from Republicans. Representative Thomas Massie, a Republican from the Kentucky district where Mr. Koskinen grew up, said he has not been pleased with how the commissioner has handled himself at the hearings, pointing to what he called evasive answers.

“I’d say he’s exercised poor judgment,” said Mr. Massie, who once worked at the same oil refinery in Catlettsburg, Ky., where Mr. Koskinen spent summers digging foundations with a jackhammer.

At the latest hearing, Mr. Koskinen sat alone at the witness table in a dark gray suit, powder blue shirt and patterned tie. He tapped his fingers gently on a leather folder and grinned serenely, responding to questions with flurries of facts and occasional dashes of sarcasm, all with a clipped monotone.

Despite the hole the I.R.S. finds itself in at the moment, Mr. Koskinen seems to relish the experience in his own way, verbally jousting with skills honed on the debate team at Duke while bringing his management acumen to bear to improve communication within the agency.

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Mr. Koskinen has apologized to those whose applications for tax-exempt status were delayed because of a targeting of political labels. The agency came under fire after revelations last year that it brought additional scrutiny to applications submitted by groups with the terms “Tea Party” or “Patriots” in their names. But Mr. Koskinen maintains that he has seen no other wrongdoing or cover-up.

Treasury Secretary Jacob J. Lew continues to express confidence in Mr. Koskinen and said the commissioner was the administration’s top choice for the job because of his experience turning around large organizations.

“That was the set of skills very much needed at the I.R.S. at the point when he was nominated,” Mr. Lew said in an interview. “It’s almost the definition of a thankless job.”

Mr. Koskinen’s “Mr. Fix-It” reputation and experience in both the Bill Clinton and George W. Bush administrations made him a sensible choice for the role, but some have wondered about his lack of tax experience and have questioned his motivations.

Competitive by nature, Mr. Koskinen learned to take hits and dish them out playing high school football in Ashland, Ky., during the 1950s. A linebacker and center, he kept spirits high despite losing seasons and did his best to counsel younger players, said Herbert Conley, at former teammate of Mr. Koskinen who went on to become a coach.

“He led by example a lot; he was aggressive and he would get after people,” Mr. Conley said. “He was a good tackler.”

Mr. Koskinen went on to study physics at Duke before attending law school at Yale. Eager to enter politics, he took a job as an assistant to Senator Abraham A. Ribicoff, a Democrat from Connecticut. But after Richard M. Nixon was elected president in 1968, Mr. Koskinen became disillusioned and turned to the private sector, joining the Palmieri Company, a corporate restructuring firm. He worked there for more than 20 years, eventually becoming chief executive.

A bit of a risk taker, Mr. Koskinen has said that chaos excites him and that once order is restored to an organization he often feels ready to move on. The strategy has reaped financial rewards over the years, as Mr. Koskinen has amassed a net worth that ranges between $7.1 million and $27.4 million, according to federal disclosure filings. The commissioner claims to be cautious with money, having never had run-ins with the I.R.S. before joining the agency and offering the fact that he has driven the same Toyota Celica to work every day for the last 16 years.

Since taking the top job at the I.R.S., Mr. Koskinen has tried to put a friendlier face on the agency, introducing a taxpayer “bill of rights,” embarking on a listening tour of its national offices and expressing a willingness to work with people who have trouble paying their tax bills for financial reasons.

“It’s a challenge, especially in a hostile environment,” he said of his latest turnaround project.

Meanwhile, the job is not expected to get any easier. An inspector general is scheduled to weigh in on the lost emails within weeks, and Mr. Issa made clear that his committee’s inquiry was not adjourned but in recess.

“This is probably one of the worst jobs in Washington,” said Bruce McConnell, who worked with Mr. Koskinen at the Office of Management and Budget and the Y2K Council. “People really don’t like the I.R.S.”

Sometimes on airplanes, Mr. Koskinen says, strangers shy away when he explains what he does for work. However, he still sees the I.R.S. as a crucial pillar of the economy, and he vows that despite what he calls intimidation tactics, he will serve the duration of his five-year term before retiring for good.

“I’m going to have to go into the witness protection program,” he said with a laugh. “So they can’t find me.”

A version of this article appears in print on July 2, 2014, on Page A12 of the New York edition with the headline: I.R.S. Chief, in Hot Seat, Has History of Bureaucratic Rescue Jobs. Order Reprints|Today's Paper|Subscribe